Contract formation and closing the deal.

Contract formation and closing the deal.

1. Source of Contract law ; 2 variables. One is the types of legal system

   • Common law
     • Common law. Developed in England, originally. based on precedence, I.e in addition to laws made by legislatures, in addition to constitutions, in additions to rules made by administrative agencies, courts look at prior decisions to, to decide particular cases.
       • lawyers spend a lot of time reading and hunting for cases to give legal advise.
     • The law tends to be longer as every situation imagined is written in the contract.
       • There may be some variances but generally Both laws overlap due to the uniform code Introduced..
   • Civil law
     • This Civil law countries, and the civil law originated on the European continent. Civil law countries rather than relying so heavily on precedence, use instead a so-called code which is sort of an encyclopedia of law. And so a lawyer in a civil law country would go to the code try to find the principles that govern your situation, and then use a deductive process in coming up with legal advice.
     • Civil law countries rather than relying so heavily on precedence, use instead a so-called code which is sort of an encyclopedia of law. The Napoleonic code. Is a well known civil law.
       • Even if the laws in some countries over lap there are some differences. As the civil laws use a law encyclopaedia, it tends to be shorter as a code reference can be used,
   • There's another uniform law that applies internationally, unless the United Nations convention on contracts for the international sale of goods. Has 81 countries joined, If your country has adopted this, convention, then this might be the, law that governs your negotiation and your sale. You can opt out in your contract.
   • The other variable is what type of contract? There is the contracts for the sale of real estate, contracts for the sale of services, and contracts for the sale of products, which the law often calls goods

2. (Legal shadows) for contract formation under law

   • deal-making ; legal framework for contract negotiation
     • A contract is an agreement enforceable by law.
       • There are a number of perspectives
         • Global
           • You must make sure that the contract can be enforceable wherever you are or you are at risk
         • Business
           • Obtaining a contract can be termed as its ultimate core.
           • The creation of value. The best negotiator gets best value or deal.
         • Personal
           • The law gives you a lot of freedom in writing that contract to create your responsibilities and to also create your duties. Freedom of contract.
   • Dispute resolution with litigation as a Batman

3. Key elements in creating a contract.

   • Is there an agreement
     • When the other side makes an offer to you, you have to remember that if you accept the offer, but add additional terms. Although there are exceptions, as with any legal rule, you have killed the original offer, and you can no longer accept it, after that point. So be wary.
     • In moving from discussions to an actual legal contract, a framework agreement is used. You start to put together a skeleton agreement and then gradually you fill in the missing pieces
       • The Framework Agreements have differing names sometimes they are called Preprinted Leases or Real Estate Contracts.  They're called Memorandum Of Understanding,  Letters of Intent, Agreements in Principle, Memorandum of Agreement. 
       • To avoid the confusing the frame of Agreement being mistaken for a binding contract it will suffice it being labelled as a negotiation tool only. This will protect you for getting in an unprepared binding contract.
   • Consideration
     • There must be nothing illegal about the item used in the agreement or the contract will not be enforceable 
     • For a deal to be binding both parties must give up something ;consideration. It is in common law countries not civil law that practice this. It is now done all over becos the laws overlap. In a Global economy it is wise to include ‘consideration’ to be safe.
       • Consideration necessary in common law countries
       • Civil law countries consideration not necessary
   • legality of agreement
     • The agreement must have nothing illegal about it or it will not be enforcable. E.g Agreement to buy illegal items.
       • The courts will ask, is this agreement too broad in terms of geographical area covered? There are subtle areas that will take the courts to find out. And a number of considerations will need to be considered.
     • non-compete agreement when you are hired by the company ; You do not work for a similar company after leaving. Generally, these agreements are legal. They do not violate public policy. But if they're crafted too broadly then a court will say, well, this agreement is not legal. Some places like California it is not enforcable. In some cases a court will have to investigate to ascertain if the contract is enforceable.
   • Must the deal/ contract be in writing
     • There are  a number of surliest involved when it comes to wether or not it should be in writing. If the deal is not in writing there must be a practical approach to avoid legal complications.
     • Contract formation and closing the deal.
     • Complications when the deal is in writing
       • It all depends if there is a the added rule to the contract. This rule precludes anything not written in the agreement To just what Is written in the agreement alone. Though it is advantageous to write it preventing endless searches and determining what was discussed in the negotiation, it is up to you to make sure it is all there or you lose  out. Due diligence needed.
       • There is a difference in civil law countries where it is applied differently or or legally not applied.
       • “Parole Evidence Rule” is added as a a separate clause in every business contract in a.civil or common law country it brings the deal to a Final conclusion. No needs for. courts spending time to determine what was said as it is all written.
       • If a request is made after the agreement is signed. And the understanding is agreed upon . Even if this is written it is not enforcable becos their is no consideration. The deal is been done and considerations have been made. Any new additions will need considerations or it is not enforcable.
     • Complications when not in writing
       • Some oral agreements do not have to be in writing and some do depending on the importance.
         • It is always safer to have all agreement / deals in writing .
           • Interact put in writing - Express contract. There are a number of contract terms that are implied by law. You must understand them.
             • These are  Implied terms are automatically included by law. Wether you are aware or not.
             • There is implied in a sales contract when is somebody in business, in this case the business of selling; it is implied that there is a warranty on the goods sold should be of a certain standard.
     • Not necessary in civil law countries but may be applied differently in some exceptions

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